Question

uperior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): Selling expenses $ 214,000 Purchases of raw materials $ 267,000 Direct labor ? Administrative expenses $ 153,000 Manufacturing overhead applied to work in process $ 365,000 Actual manufacturing overhead cost $ 352,000 Inventory balances at the beginning and end of the year were as follows: Beginning of Year End of Year Raw materials $ 55,000 $ 32,000 Work in process ? $ 24,000 Finished goods $ 40,000 ? The total manufacturing costs for the year were $680,000; the cost of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled $668,000; and the net

Answer 1

Answer:

Cost of Goods Manufactured $705,000

Adjusted cost of goods sold $655,000

Explanation:

Cost of Goods Manufactured Schedule

Beginning Raw materials $ 55,000

Add Purchases of raw materials $ 267,000

Less Ending Raw materials $ 32,000

Direct Materials Used $ 290,000

Direct labor ? $ 25,000

Add Manufacturing overhead applied to work in process $ 365,000

The total manufacturing costs for the year were $680,000;

Total Mfg Costs- Mfg OH - DM- DL

($680,000-$ 365,000 -$ 290,000= $ 25,000)

Add Beginning Work in process ? $ 89,000

$ 769,000- $680,000= $ 89,000

Cost of Goods Available for  Manufacture $ 769,000

$705,000+$ 24,000=$ 769,000

Less Ending Work in process  $ 24,000

Cost of Goods Manufactured $705,000

($745,000-$ 40,000 =$705,000)

Cost of Goods Sold Schedule

Cost of Goods Manufactured $705,000

Add Beginning Finished goods $ 40,000

The cost of goods available for sale totaled $745,000

Less Ending Finished goods  ? $ 77000

($745,000-$668,000= $ 77000)

The unadjusted cost of goods sold totaled $668,000

Less Over applied Manufacturing Overhead ($ 365,000 -$ 352,000 ) 13000

The adjusted cost of goods sold totaled $655,000

Notes :

We add and subtract as per given schedule but then there are balances missing. So we do reverse functions and start at the bottom to get the desired balances by adding or subtracting . The workings for each step have been given in the brackets underneath the step.